Portugal bail out

[rotatek]

Hi all....
As my family and I are on our way over Easter to look at properties in Portugal, I was wondering what if anything I should bear in mind with the news Portugal is heading for a bail out...
Does this have an impact on property prices now or in the future, and what will it mean long term????
Should we stay clear??????
Many thanks...

[Prime Quest]

Hi, very shortly the bail out impact in real estate can be resumed to a lower demand and higher offer. Bank mortgage conditions in Portugal are worst so renting will start to have a higher cut in the overall market.

Raising the offer will lead to lower prices, if you know the market then it will be easier to get a great deal now than when demands starts to pick up again.

If you can get good credit conditions wether in Portugal or abroad (this of course, IF you need a credit) I don't see any reasons to stay clear... Now is the best time to invest, just study your options carefully.

Best regards,

João Soares

[Albufeira]

Though the initial thread was started months back I'll add some observations that I have made as an agent that is working in Portugal and previously worked in the U.S.

The high-end market is doing extremely well in Portugal. This is especially true in the greater Lisbon area, the Algarve and the Troia peninsula. Many of the buyers this year are from Brazil and to a lesser extent Russia.

The lower end of the market here in the Algarve has two sorts of properties. First are those where the owner has priced it realistically and is able to sell. These properties are selling and often quickly. However, many if not most of the listings are unrealistically priced. Owners fail to realize that a house is only worth what a buyer is willing to pay for it.

Unlike Spain, the housing market in Portugal stayed relatively flat throughout the past decade. Prices did rise but not by much, however due to the recession they have fallen somewhat since last year. Because the market in Portugal wasn't really negatively impacted until around last year many sellers are still in denial about the values of their homes. I saw the same thing happen in 2008-2009 in Florida. However, banks here have been dumping their inventory of foreclosed homes onto the market and just like in Florida sellers will eventually have to wake up to reality.

That being said there are still good opportunities for the savvy investor. Under the new government rent-control laws are being removed from Lisbon and Porto. Many of the rents in the historic areas of these cities have been kept ridiculously low meaning that landlords have had little or no incentive to renovate or keep up these properties. Unlike many cities in Europe, Lisbon and Porto avoided the horrors of the war and have an abundance of beautiful historic quarters that could be restored and gentrified.

The other areas that seem poised for growth are the West Coast of Algarve as well as the coastal Alentejo. Anyone who as been to Vila Nova de Milfontes will know what a gem of an area this is. However, compared to the built up regions of the Algarve it is relatively unknown. Finally there is Tavira which is a quaint historical town near Faro with gorgeous beaches that has not been built up.

[brian]

Interesting post, Albufeira - it's just a shame I'm not very familiar with Portugal otherwise I might keep a closer eye on the country. Perhaps next year ...

[calico10]

Have you still got your narrowboat for sale